To register
Every month
At the year end
Changes to report
Registered, unregistered and gross
If you're registered, contractors deduct 20% from your payments as an advance towards your tax and National Insurance (net payment status). If you aren't, they must deduct 30%. You can apply for gross payment status if you don't want deductions taken, and applying also registers you for CIS.
If a statement goes missing
Ask the contractor for a replacement. If you can't get one, for example because the contractor has stopped trading, HMRC asks you to write with your name, address and UTR, the contractor's details, the payment dates or tax months and the reason you don't have the statements.
Related
What else will you need?
- CIS300CIS300 monthly returnThe CIS300 is the monthly return a Construction Industry Scheme contractor sends HMRC.
- Where to find itFind a CIS verification numberA CIS verification number is the reference HMRC gives a contractor when it verifies subcontractors before paying them.
- TemplateCIS deductions registerA CIS deductions register records each monthly payment and deduction statement a subcontractor gets from contractors: gross pay, materials, the deduction taken and the net paid.Excel
- SA103SA103 self-employment pagesSA103 is the self-employment section of the Self Assessment return.
- Where to find itFind your UTRYour Unique Taxpayer Reference (UTR) is a 10-digit number HMRC gives you when you register for Self Assessment or set up a limited company.
Rather we did it?
Countify can handle this for you, for a fixed fee agreed upfront.
Questions
Frequently asked questions.
How much will a contractor deduct from my pay?
20% if you're registered for CIS, 30% if you aren't, and nothing if you have gross payment status.
How do I get CIS deductions back as a sole trader?
Put your gross pay and total CIS deductions on your Self Assessment return. HMRC sets the deductions against your bill and repays anything you've overpaid.
Can my limited company use CIS deductions against Corporation Tax?
No. Companies set deductions against their PAYE bill through the EPS. HMRC warns that using the Company Tax Return may lead to a penalty.
Which statements should I keep?
Every monthly payment and deduction statement from every contractor. They're your evidence when you claim the deductions back.
Checked against GOV.UK on · Reviewed by Kamran Ishaq FCCA, Founder & CEO, on .
Sources: What you must do as a CIS subcontractor (opens in a new tab) (HM Revenue & Customs); CIS subcontractors: how to register (opens in a new tab) (HM Revenue & Customs); CIS subcontractors: get paid (opens in a new tab) (HM Revenue & Customs); CIS subcontractors: pay tax and claim back deductions (opens in a new tab) (HM Revenue & Customs); CIS subcontractors: changes you need to report (opens in a new tab) (HM Revenue & Customs).